Volkswagen, BMW opt for Thai offices

Volkswagen, BMW opt for Thai offices

Local units will deal with parts purchasing

Noshir Desai (seated), Volkswagen's procurement general manager for Asean, listens to speakers at a networking event of the Thai European Business Association in Pattaya. Volkswagen and BMW are siting parts-buying offices in Thailand. 
Noshir Desai (seated), Volkswagen's procurement general manager for Asean, listens to speakers at a networking event of the Thai European Business Association in Pattaya. Volkswagen and BMW are siting parts-buying offices in Thailand. 

Two German carmakers, Volkswagen and BMW, will set up international purchasing offices in Thailand to procure auto parts to serve operations worldwide.

According to Noshir Desai, general manager for procurement at Volkswagen Group's Asean regional office, the company has decided to move its purchasing office from Kuala Lumpur to Samut Prakan.

The new unit is scheduled to start up in August at Scania's assembly plant, which handles the group's Swedish buses and trucks.

Thailand is home to about 700 companies supplying Volkswagen, compared with 200 in Malaysia, Mr Desai said.

Volkswagen shipped auto parts from Asean to the Wolfsburg-based parent firm to the tune of €136 million (5.4 billion baht) last year, up 21%. Half of the total came from Thailand.

"Moving the international purchasing office to Thailand will be more closer to do a business with our suppliers to beef up the export volume," Mr Desai said.

At present, Volkswagen has operations in four Asean countries -- Thailand, Malaysia, Indonesia and the Philippines -- with five multinational brands: Germany's Volkswagen, Audi and MAN; Italy's Ducati big bikes; and Sweden's Scania.

The Thai facilities make Scania and Ducati, while the Malaysian operation assembles Volkswagen and Scania. The Indonesian operation makes Volkswagen, and Audi and MAN trucks are produced in the Philippines.

Mr Desai declined to give an update on future Volkswagen projects such as eco-car development in Thailand. The company is one of 10 applicants for the scheme.

The Board of Investment had already approved Volkswagen's bid before the company was hit by an emissions-cheating scandal last September.

Carsten Mueller-Deiters, head of purchasing for BMW Group Thailand, said his company's international purchasing office would open on June 1 at All Seasons Place on Wireless Road in Bangkok.

The new unit is part of a development plan meant to increase completely built-up (CBU) exports this year and next, aiming to ship 10,000 cars annually, mainly to China.

"The group's manufacturing in Rayong is expected to assemble 16,000 BMW cars this year and 20,000 next year for domestic sales and exports," Mr Mueller-Deiters said. "The new international purchasing office will increase sourcing of auto parts in the near future, compared with the value of 4 billion baht last year with 8,900 cars made."

He said 1.2 billion baht of the total value last year was for exports to BMW's operations worldwide.

The group runs the assembly operation of BMW, Mini and BMW Motorrad at Rayong's Amata City Industrial Estate under BMW Manufacturing (Thailand), making 20,000 cars and 10,000 motorcycles a year.

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